Most convenience retailers understand the importance of reconciling their physical inventory in the store, but a surprising number don’t fully realize the tools available to help with tracking their wetstock, otherwise known as fuel inventory. Both c-store owners and carriers must work together to accurately track fuel levels, at the store and on the truck, to ensure effective inventory management.
Accurate fuel inventory management is critical, because fuel sales have notoriously thin margins. Even seemingly minor inaccuracies in your inventory can impact not only your bottom line but your store’s reputation with consumers. And you can end up having to pay the price for any mistakes.
So, how do you put an end to the losses? As a c-store owner, you must identify the most likely areas of impact to prevent or address inaccuracies as soon as they happen. The first step is to identify potential delivery shortages/overages, losses, leaks, or manual errors.
Ensuring accurate fuel delivery
At the convenience retail level, fuel prices are an initial (and sometimes only) attractor for customers. Once a customer is at your site, it’s imperative that you can meet their needs—because your business reputation depends on it. Running out of fuel doesn’t simply result in a lost sale or a few lost customers. It instills a lack of trust, which has the potential to erode sales on a long-term basis. The last thing you need is for your hard-earned customers to begin visiting your competitors down the street instead.
Conversely, having too much fuel on hand ties up your budget unnecessarily. Here’s where working collectively as convenience store owner and jobber come into play. It’s imperative to leverage fleet technology that can calculate exactly how much fuel is on the truck and how much fuel needs to drop. You then need to make sure this information is integrated with your site-level back-office software, allowing your team to easily reconcile fuel amounts.
Identifying fuel shrinkage
Theft, better known as shrinkage, is defined as a discrepancy in the amount of a verifiable product you have onsite versus the amount your software reports you should have onsite. These discrepancies take place in many forms. Shrinkage could take the form of vendor/carrier fraud, employee theft, customer theft, or paperwork errors.
The difference between carrier shrinkage and inaccurate fuel delivery comes down to intent. This is where technology protects both convenience retailers from theft and jobbers from accusation. With the proper technology, convenience retailers can be alerted to any inaccuracy after a tank filling, such as a carrier shorting the store.
What happens if that’s not the case, but you’re still missing fuel? Syphoning fuel can occur as easily as an inaccurate fuel drop. Solving this issue is relatively simple. Start by monitoring your automatic tank gauge (ATG) sensors for inaccuracies between your tank amounts and fuel sales.
Without the proper software, imagine how many gallons of fuel you’d need to sell just to replace a single missing gallon. Compounded over countless gallons, this issue could leave you financially responsible for covering a significant amount of loss.
Following environmental standards
In some cases, your inventory may be short due to issues far less nefarious than shrinkage, such as a leakage problem with your storage tanks. According to the EPA, “Inspections conducted nationwide indicate that most people who think they are doing [fuel] inventory control are not doing it in a way that is likely to find leaks and meet the law’s requirements for leak detection.”
Make sure you’re following the proper environmental codes for your state in order to catch potential leaks in your storage tanks and containers. With such slim margins to manage, you need digital technology to help track the amounts carriers drop into your tanks against the quantities sold in your forecourt.
Because fuel inventory tools can come in all metaphorical shapes in sizes, you need tools that can integrate easily, ranging from supply chain logistics for carriers to back-office software for retailers. This allows both c-store owners and jobbers to gauge the amounts dropped at each site more accurately.
Investing in the right technology can help you control every aspect of your operation, whether that includes your convenience store or your fleet. You can greatly reduce administrative time by leveraging single-solution technology that helps you reconcile fuel sales with inventory levels—allowing you to sell your inventory at competitive prices.
You can thrive in today’s digital economy. Contact us today to learn how we can help you transform your business.